Micron Squeezed by Apple's China Chip Talks
Micron Technology (MU) is facing a new challenge as Apple considers sourcing memory chips from Chinese manufacturers, including ChangXin Memory Technologies (CXMT) and Yangtze Memory Technologies Co. (YMTC). This move could erode Micron's grip on premium device contracts, which the company has built on high-volume agreements with top clients.
According to reports, Apple had sought approval to buy chips from CXMT and was already testing them in products. However, Commerce Secretary Howard Lutnick stated that the U.S. government does not want Apple to source memory chips from Chinese manufacturers, citing national security concerns.
The Senate has set an Aug. 21 deadline for Apple to respond to bipartisan senators' demands concerning Chinese memory suppliers, particularly CXMT. Lawmakers are pushing Apple to state whether it will exclude CXMT and other Pentagon-designated Chinese memory companies from its products and disclose details about supplier testing.
Micron's stock has been trading near the $1,000 mark, with shares climbing 1% in overnight trading to $971.66. The rally is colliding with rising geopolitical tension over Apple's supply chain decisions.